The key facts
- Layoffs over the past week affected the communications, social media, WordPress.com and VIP enterprise teams
- In September the board unsuccessfully tried to remove CEO Matt Mullenweg, after which the board was fully replaced, and the CFO, interim CFO and Chief Legal Officer departed
- According to sources, layoffs may be spread over months to improve Q4 figures ahead of a June debt restructuring
Layoffs begin
Automattic, the parent company of WordPress.com, WooCommerce, Tumblr and other services, has begun laying off employees. According to TechCrunch sources, over at least the past week the cuts affected the communications team, the social media team, WordPress.com and the VIP business (the enterprise division). Employees, they say, are bracing for further layoffs.
Context: leadership upheaval
The layoffs come amid an ongoing crisis at the company. In September, the board of directors made a failed attempt to remove CEO Matt Mullenweg, which led to a complete change in the board's composition and the departure of a number of top executives, including the CFO, the interim CFO and the Chief Legal Officer.
Departures and public comments
Communications director Megan Fox announced her departure on LinkedIn last week, calling it an 'unexpected end' and noting that her position had been 'eliminated.' TechCrunch also reported that interim CFO Jeremy Klaperman left the company at the beginning of this month, a few weeks after the board reshuffle. Mullenweg suggested on X that Klaperman may have been 'hurt' by the search for external candidates for the role; however, according to information obtained by the outlet, within the company Mullenweg asked Klaperman to reconsider.
Slack personal data scandal
According to screenshots reviewed by TechCrunch, Mullenweg at one point posted personal information about one of the recently departed top executives in the internal Slack: it concerned a health problem of that person's spouse and the claim that the company was not providing the necessary COBRA insurance. Mullenweg said the top executive is threatening to sue over this, and also said his own fiancée had faced the same illness. Some employees, according to TechCrunch, were shocked that the CEO shared such personal information in such a format.
Mullenweg's response and future plans
When asked for comment on the layoffs last week, Mullenweg replied that the number of dismissals does not exceed the usual level. On Wednesday, when asked about the growing number of cuts, he said he was 'mostly focused on PHP' — he had written on X about a PHP security issue affecting the internet, and it takes priority. The company's About page lists 1,397 employees. According to TechCrunch sources, the plan is likely to spread the layoffs over the coming months in order to improve fourth-quarter revenue figures ahead of the debt restructuring scheduled for June.
